Do we take this to the Ombudsman?

Yes

No

I am happy. Do nothing.

On Friday when I signed on to drive, I had to sign a new agreement before commencing. In the agreement it seems that Uber have reduced our portion of the ride by 2.5%, from 75% to 67.5% as from 1st August 2017. If you don't click to accept the agreement then you cant drive. It is unfair not to give us an option. I joined after April 24, 2016. I have been driving for a year and steadily my income has been whittled away by several factors, one of theses factors is that there are now too many drivers and not enough rides, and now a pay cut.
This is the only industry in Australia where "Independent Contractors". Have absolutely no control on what they charge their customers. We also pay GST to Uber and we cant claim it back from the ATO. If GST is charged to the customer then Uber should pay us the 10% before they take their cut. Currently they are taking a portion of our GST. Early last year I wrote to the ATO asking them about this GST situation with Uber and their take on it was simple. "You signed the contract, so its your problem." I guess they are right, but what gets to me, is that we are powerless to do anything about the new contracts that keep popping up. In which industry in Australia are employees (sic) "contractors" contracts changed willy nilly. If you read your contract you will see that it is open ended, and the contract can be changed at any time. This is as good as not having a contract at all. Surely this is illegal. I believe that we should take action to set things right. All our contracts should be written using guidelines set out by the fair works ombudsman before we are asked to sign them.

If you were working for any other company as an independent contractor, and at the start of your agreement both you and the company signed an agreement stating that you would work under specific conditions and that you would be paid a specific amount. If that company were to change that agreement at any time after the signing, with a threat that you would no longer do any more work for them unless you signed a new contract that would change the conditions and or reduce the amount of money you receive. If this had to happen, then I am sure that the fair work ombudsman would take action against the company. So what about Uber. Are there different rules for them. Uber is a money company and as you all know, money can bend governments.

What do we do? Just take it on the chin, or do we do something about it?

Attached Files:

Drivers had to pay GST on the full gross fare before. Uber now pay their own share of GST directly to the ATO (GST on the "commision" they charge drivers). Drivers can later claim back the extra 2% charge as input creditS on their BAS statments.

Under current classification all drivers must pay GST so there is actually no change to drives' bottom line. It is either the driver pay this portion to the ATO on behalf of Uber or Uber (now) pay it directly themselves.

You can avoid the situation by uploading your ABN to Uber. They will not deduct the extra 2% in that case but you will need to pay GST on the full fare come BAS time.

I am not aware that this has changed, from my last correspondence with the ATO, they did not mention it, however I will taker it at face value and investigate it later.

I notice that you made no comment on the wage/fee reduction of 2.5%. This has probably been introduced to cover Uber's cost on the GST payments.

FYI - I did upload my ABN to Uber months ago, and there has been no change, the fee is still the same. 25%/75% split. No change at all. I pay my GST this is not the issue. The issue is the extra 2.5% that Uber is taking.

A contract can not be legal if it has been submitted in a manner where the lesser party to the contract feels that he/she has been pressurised into signing it (Under duress). As in. "You can no longer drive (Earn Money) if you do not agree to the contract."

I must point out to you that this is proof that you are not in control of your service fee. If you were than you would have the power to pass this extra cost that you have just incurred, on to your riders. Do you have that option? Its Ubers way of controlling the drivers as they please. How on earth can a contract be binding if only one party is able to change it, and they change it at will. Whenever they please! They have us by the short and curlies. Ether you sign the contract or you get out! You have no option.

I am not aware that this has changed, from my last correspondence with the ATO, they did not mention it, however I will taker it at face value and investigate it later.

I notice that you made no comment on the wage/fee reduction of 2.5%. This has probably been introduced to cover Uber's cost on the GST payments.

FYI - I did upload my ABN to Uber months ago, and there has been no change, the fee is still the same. 25%/75% split. No change at all. I pay my GST this is not the issue. The issue is the extra 2.5% that Uber is taking.

A contract can not be legal if it has been submitted in a manner where the lesser party to the contract feels that he/she has been pressurised into signing it (Under duress). As in. "You can no longer drive (Earn Money) if you do not agree to the contract."

I must point out to you that this is proof that you are not in control of your service fee. If you were than you would have the power to pass this extra cost that you have just incurred, on to your riders. Do you have that option? Its Ubers way of controlling the drivers as they please. How on earth can a contract be binding if only one party is able to change it, and they change it at will. Whenever they please! They have us by the short and curlies. Ether you sign the contract or you get out! You have no option.

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Try re-uploading your ABN number to Uber. According to Uber it is business as usual and there is no change to commission for drivers who supply an ABN number.
Other drivers, those who dont supply Uber with an ABN number can claim back the extra 2% in commission as GST input credits when they do their BAS.

The other points you raise are spot on. Uber can change the contract at will with no prior notice and drivers have absolutely no say about it all. They must accept the new contract or be out of a job. Great "partnership" we've got going there...

The 2.5% increase is only for the drivers who have not submitted their ABN and GST details to Uber as Uber will need to cover the GST to the ATO. If you have provided your ABN then the 25% (Uber take) is unchanged.

I can confirm that UBER is currently sending out notices regarding the change of fees from 1st December, 2018.

At first glance, these appear to reduce your cut by 2.5%. In reality, UBER is now charging GST in their fees. Previously, Uber was already costing you the extra 2.5%, because their 25% fee was calculated on the full fare amount, and GST is also calculated on that amount. So basically, drivers were paying UBER's portion of GST themselves. Now UBER has set up an Australian Entity, and is formalising the GST obligations. This is not actually taking more money from your pocket - it is just highlighting the fact that UBER has ALWAYS been putting this cost onto the driver.

In my opinion, drivers who paid Ubers portion of the GST will be 2.5% better off because they will only pay GST on the driver portion from 1 December and receive a GST credit on the portion collected by Uber.

Issues arising from this change:
a) There is likely to be some argument about 10% GST on full fare paid by drivers for the period July 1 2017 to 30 November 2017 for which there is no GST input credit for the 2.5% Uber portion of GST.
b) There is an argument that Uber has already collected the GST portion on their fees because their fee is calculated on the GST inclusive fare.
b) BAS will be more complex for current quarter as the change occurs during this period.

In my opinion, drivers who paid Ubers portion of the GST will be 2.5% better off because they will only pay GST on the driver portion from 1 December and receive a GST credit on the portion collected by Uber.

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Technically, drivers are no better or worse off. Its simply that UBER will now remit the GST on their service fee to the ATO rather than the driver doing it. After GST is paid, the amount left for the driver remains the same.

Issues arising from this change:
a) There is likely to be some argument about 10% GST on full fare paid by drivers for the period July 1 2017 to 30 November 2017 for which there is no GST input credit for the 2.5% Uber portion of GST.
b) There is an argument that Uber has already collected the GST portion on their fees because their fee is calculated on the GST inclusive fare.
b) BAS will be more complex for current quarter as the change occurs during this period.

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Any arguement will be between the ATO and UBER. As above, drivers will pay the extra GST anyway for the first 2 months. BAS will be more complex due to the change happening mid quarter

Technically, drivers are no better or worse off. Its simply that UBER will now remit the GST on their service fee to the ATO rather than the driver doing it. After GST is paid, the amount left for the driver remains the same.

Any arguement will be between the ATO and UBER. As above, drivers will pay the extra GST anyway for the first 2 months. BAS will be more complex due to the change happening mid quarter

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I wonder then if drivers paying only (sarcasm alert) the 25% will continue only paying the 25%
This despite goobers coughing up their gst share

Might end up w/ four different commissions

Actually isn't there something inherently wrong w/ the fact that there are different commissions?
Also that they don't change or even improve w/ longevity or performance?

There are so many things wrong with the goober scam that the list still keeps growing even after eight years of exploitation

I wonder then if drivers paying only (sarcasm alert) the 25% will continue only paying the 25%
This despite goobers coughing up their gst share
Might end up w/ four different commissions

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No, you misunderstand how the calculations work. If you are currently on 25% fee (like me) then UBER retains 25%. BUT, the 25% is calculated on the entire fare, which is all GST inclusive. The driver has to pay the GST on the whole fare. It's like both the GST (10%) and UBER (25%) are taken from the top. Because you don't currently get any GST credit from UBER, but you still have to pay the GST on their share, you are already effectively losing 10% GST + 25% UBER + 2.5% (UBER's GST, 10% of their cut) = 27.5%. It's just the driver is paying the extra 2.5% to the ATO with their BAS, rather than UBER paying it themselves.

After GST, the new 27.5% UBER fee will work out to exactly the same amount for the driver. UBER is just now highlighting that drivers are having to pay for their lost GST revenue... which still sucks.

Is surge GST free?Bonus or top-up payments
GST is a tax on consumption in Australia only. If you receive a bonus or top-up payment from an overseas facilitator the service you are providing is not consumed in Australia and is GST-free.

GST-free services may include:

marketing and promoting the facilitator to potential customers for which you may receive bonus payment from the facilitator, for example when a new customer quotes your reference code or other identifier

operating during certain times, such as peak hours for which you receive a top-up payment from the facilitator – the top-up payment is not part of the fare and is in addition to the fare paid by the passenger.

Is surge GST free?Bonus or top-up payments
GST is a tax on consumption in Australia only. If you receive a bonus or top-up payment from an overseas facilitator the service you are providing is not consumed in Australia and is GST-free.

GST-free services may include:

marketing and promoting the facilitator to potential customers for which you may receive bonus payment from the facilitator, for example when a new customer quotes your reference code or other identifier

operating during certain times, such as peak hours for which you receive a top-up payment from the facilitator – the top-up payment is not part of the fare and is in addition to the fare paid by the passenger.

Is surge GST free?Bonus or top-up payments
GST is a tax on consumption in Australia only. If you receive a bonus or top-up payment from an overseas facilitator the service you are providing is not consumed in Australia and is GST-free.

GST-free services may include:

marketing and promoting the facilitator to potential customers for which you may receive bonus payment from the facilitator, for example when a new customer quotes your reference code or other identifier

operating during certain times, such as peak hours for which you receive a top-up payment from the facilitator – the top-up payment is not part of the fare and is in addition to the fare paid by the passenger.

But it looks (to me) like the following line may null it:
"GST is a tax on consumption in Australia only. If you receive a bonus or top-up payment from an overseas facilitator the service you are providing is not consumed in Australia and is GST-free."

The service is consumed in Australia, passengers are presumably paying the GST on the full fare, surge included, drivers (or Uber really) must pass that GST on to the ATO.